Looking For The Next Big Trade? Precious Metals Could Be It

Precious Metals Rush Happening Worldwide

The financial news these days is filled with stories about investors rushing to buy cryptocurrencies and “Metaverse”-related stocks—and about why electric vehicle stocks and financial technology (fintech) stocks could be worth the investment.

Here’s the thing: generally, when you hear about the “next big thing” in the mainstream media, chances are you’ve already missed out. If you’re looking for the real next big trade, you have to look in places that aren’t in the headlines, but where interest is building up.

One place that could provide stellar gains is the precious metals market, specifically the gold and silver markets. On one level, these precious metals are being ignored right now, but there is a lot of interest building up. In fact, it wouldn’t be wrong to say there’s a gold and silver rush happening.

Just so you know, silver trades about 52% below its all-time high, made in 2011, and about 23% below its recent high, made in early 2021. Gold trades about 15% below its all-time high, made in August 2020.

Photo by Old Money on Unsplash

Gold & Silver Sales Through The Roof At The U.S. Mint

For some perspective, look at gold and silver bullion sales at the U.S. Mint. So far this year, the mint has sold almost 1.2 million ounces of gold in American Eagle coins. Keep in mind, there’s still one month left in the year. (Source: “Bullion Sales,” U.S. Mint, last accessed November 25, 2021.)

How does this compare to previous years? The U.S. Mint’s gold sales so far in 2021 have been their highest since 2010! Compared to full-year 2020, gold sales at the mint are already up by 36% this year. In 2019, the U.S. Mint sold just 152,000 ounces of gold in American Eagle coins. Their 2021 gold sales represent an increase of 656% over their 2019 figures.

Looking at silver sales, year-to-date, the U.S. Mint has sold 27.8 million ounces of silver in American Eagle coins. In 2020, it sold 30.1 million ounces. In 2019, this figure was just 14.9 million ounces. The last time the U.S. Mint’s silver sales in American Eagle coins were in the 30-million-ounce range was in 2016.

Strong Global Demand For Precious Metals

But don’t get too fixated on the bullion sales figures at the U.S. Mint. This is a global phenomenon. Mints around the world say their bullion sales have been through the roof lately.

At Australia’s Perth Mint, between January and September 2021, the mint sold 819,029 ounces of gold. This is 41.3% higher than in the same period a year ago. (Source: “Perth Mint Gold and Silver Bullion Sales Surge in September,” CoinNews.net, October 15, 2021.)

The Perth Mint’s silver sales have been strong as well. In the first nine months of the year, it sold 14.5 million ounces of silver, which is 10% higher than in the same period a year ago. Month-over-month in September, the Perth Mint’s silver sales jumped by 22%.

The Royal Canadian Mint has also been seeing high demand for precious metals. Lorne Whitmore, managing director of the Canadian mint’s precious metal sales department, said, “We’re still seeing a huge amount of demand for both gold and silver in the marketplace and it’s broad-based, (from) across the world.” (Source: “Pandemic-Driven Demand for Safe-Haven Investing Sends Sales of Gold Bullion Soaring, Canadian Mint Says,” Toronto Star, July 8, 2021.)

Precious Metal Price Outlook

I could list many more places where the demand for precious metals has been surging. However, I will just say this: gold and silver are really worth a look.

These two precious metals are off their highs while everything else is at all-time highs.

I think gold and silver have a bright future, but you shouldn’t expect them to double in price overnight. Investors who can hold on to them for the long term could make hefty profits. I believe silver could make a run toward its all-time high around $50.00 per ounce if not more, and gold could hit $3,000 per ounce in the coming years.

Disclaimer: There is no magic formula to getting rich. Success in investment vehicles with the best prospects for price appreciation can only be achieved through proper and rigorous research and ...

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